10/17/2011

World’s 10 Biggest Employers

IBM is the world’s third biggest technology company by market cap, behind Apple and Microsoft. It is also one of only two tech giants to make the list of the 10 biggest employers.
Founded in 1911 as the Computing Tabulating Recording Company, the firm adopted the name International Business Machines in 1924. Its operations span computer hardware, software, infrastructure and consulting services. IBM marked a major milestone this year, celebrating 100 years since its founding. It now has employees in over 200 countries.
In 2009, IBM announced it was shedding as many as 10,000 U.S. jobs. The company has been accused of offshoring U.S. jobs to Asia and South America. In 2003, IBM employed just 9,000 people in India, but by 2010 that number had jumped to 75,000. In comparison, its U.S. workforce shrunk from 135,000 to 105,000 in the same period.

From 2005 to 2010, the conglomerate added over 97,000 jobs globally. The company's revenue per employee has declined by over $42,000 compared to 2005, but its profit per employee has gone up by over $10,000 in that period.

Compass Group is the world’s largest contract food service company with operations in over 50 countries. It serves 4 billion meals a year.

The company was founded in the U.K. in 1941 as Factory Canteens by Jack Bateman, and went on to grow through mergers to become the Compass Group in 1987. The caterer expects sales for its fiscal year 2011 to grow by 9 percent despite rising food costs and weakness in its European markets.

The group added nearly 18,000 employees from 2005 to 2010. U.K. and Ireland account for only 20 percent of its workforce, while over 40 percent of its employees are in North America. In recent years, the company has also improved labor productivity. Its revenue per employee has gone up nearly $14,500 from 2005 and its profit per worker is now almost five times what it was five years ago.

Compass' growth is being driven by its operations in emerging markets and North America, along with contract wins and acquisitions. In April, the group acquired two Indian companies Vipul Facility Management and Ultimate Hospitality Services to broaden its reach to 44 cities in India. Earlier this month, Compass also took over leading Turkish business food services provider Obasan.

Agricultural Bank of China, also known as AgBank, is the world’s biggest bank by the number of customers, branches and employees.

The lender was founded in 1979 to provide credit to farmers and is one of China’s big four commercial banks. In 2010, the lender’s massive IPO pulled in $22.1 billion from Hong Kong and Shanghai, making it the largest IPO in world history. China’s big push over the past decade to develop the country’s rural hinterland has spurred Agbank’s growth.

Agbank has however had a rocky past, requiring a government bailout because of bad debts. In 2008, for example, the company got a $19 billion cash infusion from the government. The company’s huge workforce hasn’t declined much in recent years even after it made a transition from a completely government owned lender to a publicly listed company. The bank is less profitable on a per-employee basis than other Chinese lenders such as ICBC, which is the world’s largest bank by market cap and assets. ICBC for example has revenues per employee of $150,000 and profits per employee of $65,000.

Deutsche Post DHL is Europe’s largest mail and express delivery company and one of the world’s biggest logistics firms.

The German company, which operates in more than 220 countries, was privatized in 1995, but state-owned bank KfW owns a 30 percent stake. Deutche Post’s labor force has increased in recent years, because of a number of acquisitions such as British logistics company Exel and India’s Blue Dart. However, the company has also been shedding jobs and its net full-time payroll has shrunk by about 7.5 percent from a total workforce of about 455,000 in 2005.

Deutsche Post’s business has been affected by a growing trend towards email rather than snail mail. It recently reached a deal with German union Verdi for average wage cuts for new mail employees of 4 percent in exchange for guaranteeing the jobs of 130,000 workers through 2015. The company said the move was an effort to stabilize operating profits in the mail business at $1.36 billion, as well as deal with the future shrinking of the mail market.

On the other hand, the company’s freight services have been experiencing strong profit growth. In August, the group announced that full-year 2011 profit would be up to $3.5 billion, higher than analysts expectations of $2.36 billion.

France’s Carrefour is Europe’s largest retailer, and the world’s second-largest retailer after Wal-Mart. Founded in 1958 by the Fournier and Defforey families in southeastern France, the company now has hypermarkets and supermarkets in 32 countries, with over 57 percent of its revenue coming from international operations.

The company’s workforce has increased from 436,000 in 2005 to around 471,000 at the end of 2010. In recent months, the grocery giant has issued a string of profit warnings because of slowing consumer demand in its main European markets and stiff competition in France. Carrefour warned in September that its 2011 profits would slump 15 percent as it cut prices to regain market share.

The company has also faced labor disputes recently. In April, about 65,000 French workers went on a one-day strike against low wages, job cuts and poor working conditions. Meanwhile in August, workers in Indonesia, where the retail giant employs 28,000 people, threatened strike action and staged a rally demanding better job contracts.

Carrefour generates $55,000 more in annual sales per employee compared to Wal-Mart and $60,000 more when compared to Tesco. But the company generates about $3,000 less in profit per employee than Wal-Mart and $5,000 less than Tesco.

Tesco is the world’s third biggest retailer behind Wal-Mart and Carrefour. The U.K. grocery giant, founded by Jack Cohen, opened its first supermarket in 1929, and now retails everything from books, clothing, and electronics to financial services.

The employer has seen its workforce grow 19 percent over the past five years, adding close to 80,000 jobs between 2007 and 2011. Tough trading conditions in Britain with declines in domestic profits have been offset by its expansion in fast-growing Asian markets. Profits rose by 19 percent in Asia, compared to only 4.5 percent in Britain in the six months to August 27th, compared to the same period in 2010.

Earlier this month, Tesco posted a 0.7 percent decline in U.K. sales for the three months ending August, compared to the same period last year. The drop in sales marked the firm’s third consecutive quarterly decline. The company said it would invest $784 million in cutting prices of staples like milk and carrots in a bid to reverse market share losses. In August last year, the firm also cut 2,000 management roles at its U.K. convenience stores as part of a restructuring plan.

The company's international expansions haven’t always worked out. The group recently announced that it was pulling out of Japan after eight years, selling 129 small supermarkets to focus on operations in other Asian countries.

PetroChina is China’s largest oil and gas company with a market cap of $274.3 billion. It is also the world’s second-most valuable energy firm after Exxon Mobil.

Founded in 1999, PetroChina is the listed arm of state-owned China National Petroleum Corp. (CNPC), which still owns 86 percent of the firm. The company’s activities span drilling, exploration, refining and fuel retailing. PetroChina also owns nearly all of its 18,000 branded service stations in the country.

The oil giant has increased its workforce by over 25 percent from 2005 to 2010, adding over 113,000 jobs in that period. More than 60 percent of PetroChina’s employees work in the energy production sector, accounting for around 337,000 workers. The company also has 66,000 employees who work in administration and another 66,000 in technology.

In terms of labor efficiency, PetroChina makes about $71,000 less than its competitor Sinopec in revenue per employee, but the refiner takes in $20,000 more in profit per employee compared to Sinopec.

Hon Hai Precision is the parent company of Foxconn Technology, the world's largest electronics manufacturer by revenue. Foxconn is also the largest exporter in the Greater China region.

Founded in 1974 by CEO Terry Gou with just $7,500, the Chinese tech giant now assembles everything from computers to smartphones and display panels for customers such as Apple, Cisco, Dell, Nokia and Sony.

In 2010, media reports said the tech giant planned to increase its China workforce by 400,000 over the next several years. The company has faced a string of suicides, many of which have been blamed on harsh working conditions. In response, Foxconn nearly doubled production-line salaries in 2010 to between $180 and $300 per month. Rising labor costs though have hit its net profit, which fell by 23 percent in the April to June quarter over the previous year.

About half the company’s employees work at its coastal Shenzhen plant, but the firm plans to reduce the location’s headcount by 170,000 over five years and open new factories further inland, where labor is cheaper. Foxconn is also planning to switch to using robots and will reportedly deploy one million of them within three years up from about 10,000 currently.

McDonald’s is one of the world’s most valuable brands and one of only three American companies to make the list of the 10 biggest employers.

Founded in 1955 by American businessman Ray Kroc, McDonald’s is the world’s largest chain of fast food hamburger restaurants. The company has a presence in 118 countries with over 33,000 restaurants — more than 80 percent of which are owned by independent franchisees.

In April this year, McDonald’s drew headlines on “national hiring day,” when it added a whopping 62,000 U.S. employees in one day. That was more than the 50,000 it planned to hire on that day to boost its U.S. staff by 7 percent.

McDonald’s biggest market in 2010 was Europe, accounting for 41 percent of its global revenue. The U.S. made up 34 percent of its revenue, while the rest of the world contributed roughly 21 percent.

The company is continuing to expand. In 2011, it plans to invest $2.5 billion, roughly half of it to open around 1,100 new restaurants around the world.

Walmart is the world’s largest retailer with over 9,600 stores in 28 countries.

The company was founded in 1962 by Arkansas businessman Sam Walton. The Walton family remains one of the richest families in the world with a 48 percent stake in the company.

Walmart’s workforce grew nearly 17 percent from 1.8 million employees in 2005 to 2.1 million in 2010. Over that time, the company has been able to generate high revenues and profits per employee. Its annual revenue per employee has gone up by nearly $27,000 compared to 2005, while profit per employee has also gone up by $900.

Out of its 2.1 million employees worldwide, about 1.4 million work in the U.S. Outside of the U.S., Walmart is also the largest private employer in Mexico and one of the largest in Canada. International revenues amounted to $109 billion for the same period.

With more employees than any other private company in the world, Walmart has also faced scrutiny from labor groups. It's been criticized for its strong anti-union policies. The company says its employees earn an average annual wage of between $10 and $12 per hour. But some local politicians and community organizers have protested the opening of new Walmart stores arguing that it depresses wages and hurts other businesses.